In an era when a beverage's claim to fame is twice as much
caffeine, and milk is going carbonated, it's hard to believe
the next big thing is . . . water. According to Beverage Marketing
Corp. of New York City, water is the fastest-growing major U.S.
beverage category, expected to surpass coffee and milk to take
second in volume only to soft drinks by 2004.

Now you've got four companies dominating the bottled water
market-Pepsi, Danone, Coke and Perrier Group of America-but
that's where the twist comes in. According to John Rodwan,
editorial director for Beverage Marketing Corp., you're
expecting too much if you're shooting for No. 1, but
there's a good chance your product can attain underdog status
and significant sales if you either try for regional success by
touting the water's source, or add a special something-an
ingredient or other element-to plain old water. Rodwan expects
enhanced water fortified with calcium, caffeine or added flavors to
grow "very, very quickly" this year. But he's not
sure whether, over the long term, "that's going to satisfy
consumers when they simply want water-or if it's an area
that's just a little too peculiar."

Bob Lynn, vice president of marketing and sales for
Le-Nature's, a Latrobe, Pennsylvania, company founded in 1992
that specializes in purified and fully pasteurized juices, water
and teas, has no doubt plain old water will maintain its strength,
but questions the longevity of infused water. He gives new entrants
six, maybe nine, months. "It's H20. No matter what you do
to it, it will try to revert back to being H20," Lynn says.
"Americans are faddy and sometimes gullible, but they
aren't stupid, so fads that grow and maintain in other
[countries] tend to have a very short life span in the United
States." That doesn't mean you can't garner success
with fad-beverage businesses, as long as you're able to
continually reinvent the fad.

And the Red Bull phenomenon? We'll have to wait a couple
years to see whether energy drinks outlive their fad status, but,
according to Rodwan, it's another exciting segment and the
closest thing the beverage industry's got to a totally new
category. Troy Widgery, 35, who founded Denver-based extreme sports
apparel manufacturer Go Fast Sports Inc. in 1995 and Go Fast
Beverage Co. last year, has been hard-pressed to keep up with
demand for his energy drink. Still, the beverage company, which
employs about 40 people and expects first-year sales of $3 million
to $4 million, isn't yet profitable. But, says Widgery,
"For our size and amount of [grass-roots] marketing we've
done, I would say our margins are better than
anyone's."

As for Widgery's "next big craze" prediction,
he's betting on milk thistle, an active ingredient in Go
Fast's 11 that acts as a liver detoxifier. Will it be the next
green tea? Wait, is green tea out of fashion already?

A BRIEF BEVERAGE HISTORY

early
1800s: European and American businessmen bottle
naturally carbonated water, claiming it helps indigestion and
fever.